With the additional funding, more than 100 new or upgraded hostels will gain onsite training to help residents learn practical skills, ranging from catering to sound engineering.

Ms Cooper said: "Getting people not just off the street but back into work is a major challenge.

"While homelessness is at its lowest level for 20 years, we need to press on for further improvements.

"The expansion of this scheme - which is proving a major success - will transform the life chances of thousands of homeless people."

The scheme is administered by Homeless Link, an umbrella agency representing the homelessness sector.

Its chief executive Jenny Edwards said today: "We are delighted that the government is continuing its commitment to making services for homeless people 'places of change'.

"The announcement today of an additional £70 million will enable many more hostels and day centre's transform the work they do to enable some of the most vulnerable people in our society to move on to independence."

The extra funding comes less than a week after the Conservatives accused the government of underestimating the scale of homelessness in England.

The government claims 498 people sleep rough each night, but the Conservatives say the real figure is closer to 1,300, blaming a "major hole" in official methodology.

Shadow housing minister Grant Shapps said "hundreds of hidden homeless people are sleeping on our streets every night".